Countering China's Influence in Latin America: Strategies for Supporting Taiwan's Allies

China's increasing economic and political influence in Latin America poses significant challenges for the United States and Taiwan. As Beijing aggressively courts countries in the Western Hemisphere to switch diplomatic recognition from Taipei to Beijing, the U.S. must develop effective strategies to counter China's efforts and support Taiwan's remaining allies in the region.

The Current Landscape

Over the past decade, China has dramatically expanded its economic and diplomatic presence in Latin America:

• Chinese trade with the region has reached $500 billion annually
• Chinese companies have invested $23 billion in Latin American countries since 2005
• China has established 44 Confucius Institutes to promote Chinese language and culture
• Beijing has cultivated extensive networks with Latin American academics, politicians, journalists, and business leaders

Meanwhile, the number of countries in Latin America that officially recognize Taiwan has dwindled:

• In 2017, Panama cut ties with Taiwan and established relations with China
• The Dominican Republic and El Salvador followed suit in 2018
• Nicaragua switched recognition to Beijing in 2021
• Honduras was the latest to sever ties with Taiwan in 2023

Currently, only 7 countries in Latin America and the Caribbean still maintain full diplomatic relations with Taiwan:

1. Belize
2. Guatemala
3. Haiti
4. Paraguay
5. Saint Kitts and Nevis
6. Saint Lucia
7. Saint Vincent and the Grenadines

China's Strategy and Tactics

Beijing employs a multi-faceted approach to expand its influence and isolate Taiwan diplomatically:

Economic Incentives:

• Promises of increased trade and investment
• Financing for major infrastructure projects
• Access to China's massive consumer market

Political Pressure:

• Economic coercion and threats to cut off trade
• Lobbying of local elites and interest groups
• Cultivation of pro-China voices in media and academia

Public Diplomacy:

• Cultural exchanges and educational programs
• Paid trips to China for journalists and officials
• Provision of Chinese media content to local outlets

Technology and Surveillance:

• Huawei's dominance in telecom infrastructure
• Export of surveillance systems and facial recognition tech
• Control over strategic ports and facilities

China's efforts have yielded significant results, with multiple countries abandoning Taiwan in favor of lucrative economic ties with Beijing. However, the outcomes for countries that have switched recognition have often fallen short of China's grand promises.

Impacts on Countries that Switch Recognition

While China typically offers economic incentives to countries that cut ties with Taiwan, the actual benefits have often been limited:

• Promised investments and projects frequently fail to materialize
• Increased imports from China harm local industries
• Environmental and labor concerns around Chinese projects
• Loss of Taiwan's targeted development assistance

For example, after Panama recognized China in 2017, many of the ambitious infrastructure projects announced by Beijing were never implemented. The Dominican Republic and El Salvador have seen similar unfulfilled promises.

Moreover, countries that switch often face increased pressure to support China's positions on issues like human rights and territorial claims. There are also concerns about growing Chinese influence over local politics and media.

U.S. Policy Responses

To counter China's efforts and support Taiwan's remaining allies, the United States has pursued several policy initiatives:

TAIPE Act:

• Passed in 2019 to strengthen U.S. support for Taiwan's diplomatic allies
• Promotes deeper trade ties with countries that recognize Taiwan
• Supports Taiwan's participation in international organizations

Development Finance:

• Expanded role for U.S. International Development Finance Corporation
• Joint U.S.-Taiwan financing initiatives for projects in Latin America

Diplomatic Engagement:

• High-level visits to reaffirm U.S. commitment to the region
• Support for democratic institutions and anti-corruption efforts

Economic Cooperation:

• Promotion of U.S. private sector investment
• Efforts to diversify supply chains away from China

However, recent cuts to foreign assistance programs have raised concerns about the U.S. commitment to the region and its ability to offer alternatives to Chinese financing.

Strategies for Supporting Taiwan's Allies

To more effectively counter China's influence and bolster Taiwan's diplomatic standing in Latin America, the U.S. should consider the following strategies:

1. Strengthen Economic Ties

• Prioritize trade agreements and investment with Taiwan's allies
• Leverage private sector partnerships to create jobs and economic opportunities
• Support Taiwan's efforts to expand trade and investment in the region

2. Enhance Development Cooperation

• Maintain robust foreign assistance programs focused on good governance and economic development
• Coordinate closely with Taiwan on joint development initiatives
• Highlight the benefits of U.S. and Taiwan's transparent, high-quality development projects

3. Counter Chinese Disinformation

• Expose unfulfilled Chinese promises and negative impacts of BRI projects
• Support independent media and civil society organizations
• Promote fact-based narratives about U.S.-Taiwan partnership

4. Bolster Democratic Institutions

• Invest in anti-corruption programs and judicial reforms
• Support election integrity efforts
• Highlight Taiwan's democratic success story

5. Increase Diplomatic Engagement

• Maintain high-level visits to Taiwan's allies
• Advocate for Taiwan's meaningful participation in international organizations
• Coordinate closely with like-minded partners like Japan and EU countries

6. Offer Security Cooperation

• Expand military training and assistance programs
• Support maritime domain awareness capabilities
• Enhance cooperation on transnational crime and disaster response

7. Leverage Technology Partnerships

• Promote cooperation between U.S., Taiwan, and Latin American tech sectors
• Support secure telecom infrastructure alternatives to Huawei
• Collaborate on emerging technologies like AI, quantum computing, and green energy

Case Study: Guatemala

Guatemala, one of Taiwan's staunchest allies in the region, offers an instructive example of both the challenges and opportunities in supporting Taiwan's diplomatic partners.

President Bernardo Arévalo, who took office in January 2024, has reaffirmed Guatemala's commitment to maintaining ties with Taiwan. However, his administration faces significant economic pressures and political instability that China seeks to exploit.

To shore up Guatemala's support for Taiwan, the U.S. should:

• Maintain robust economic and security assistance programs
• Support Arévalo's anti-corruption agenda and democratic reforms
• Encourage U.S. and Taiwanese private sector investment
• Counter Chinese disinformation and influence operations
• Highlight the benefits of Guatemala's partnership with Taiwan and the U.S.

By demonstrating sustained commitment to Guatemala's development and stability, the U.S. can help ensure the country resists Chinese pressure to switch recognition.

Conclusion

As China continues its aggressive push for influence in Latin America, supporting Taiwan's remaining diplomatic allies must be a key priority for U.S. foreign policy. By offering meaningful economic alternatives, bolstering democratic institutions, and maintaining robust diplomatic engagement, the U.S. can help counter Beijing's efforts to isolate Taiwan.

However, this will require sustained attention and resources from Washington. Recent cuts to foreign assistance programs risk undermining U.S. credibility and creating openings for China to exploit. To effectively compete with China's economic statecraft, the U.S. must leverage all elements of national power - diplomatic, economic, and security - in a coordinated strategy.

Ultimately, preserving Taiwan's international space and diplomatic relationships is crucial not only for Taipei's survival as a de facto independent entity, but also for broader U.S. strategic interests in the Indo-Pacific and Western Hemisphere. By working closely with Taiwan and like-minded partners, the U.S. can push back against China's malign influence and promote a free, open, and prosperous Latin America.

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